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What's holding CFOs back from digital finance initiatives


Posted by Matt Osborn - 16 December, 2019

Benefits of Switching Operations to a Private Cloud

Businesses, regardless of size, that adopt cloud computing have nothing but praise for the technology. According to Forbes, 60-70% of all spending on software and technology will be cloud-based.

The flexibility of accessing your business software on the go via a smart device as well as the cost-effectiveness and scalability options it offers are only a few reasons why cloud-based business management is booming.

However, to reap the full benefits of cloud-based business management, you need guidance in making a few critical decisions, one of which is choosing a private or public cloud for your business. This article sheds light on the differences between the two and shares why a private cloud may be your best solution.

Public vs. Private cloud

The public cloud provides computing services available to the general public that is available over the Internet. These services range from simple offerings such as email and data storage to advanced environments for software development and testing.

Depending on the services needed, you can work within a free, freemium, or paid (regular subscription or pay-as-you-go) package. The cloud vendor is responsible for all maintenance, backups, stability, development, upgrades, and security.

This is a breakdown of how company's use the cloud currently, and how it will be forecasted with usage in 2020.

business operations(source)

The public solution is preferred for its low cost, scalability, and flexibility. By leveraging a public cloud, a business does not incur any costs in infrastructure equipment or management, which is the most significant advantage. Moreover, public clouds offer many choices and resources to support a growing business in achieving its goals.

On the other hand, the total cost of subscription can be exceedingly high for mid-sized and enterprise-level businesses requiring high computational workloads. While costs for individual computation units are low, things add up – fast. Also, security may be a concern if dealing with sensitive data. These challenges are why the private cloud option is becoming popular among some businesses.

The private cloud is also referred to as an internal or corporate cloud and is a solution built exclusively for one business. The service is hosted through the company’s on-premise infrastructure or intranet or at a third-party data center with company data encrypted and protected behind a firewall.

Computing resources are typically delivered to the business via a secure private network. For many organizations, a private cloud may be the better option because the cloud can custom built to increase security to meet your projects’ requirements. The following takes a closer look at why you should switch the management of your business’s software to a private cloud.

1. Security

  • The key advantage of a private cloud is the security and privacy it offers compared to public cloud solutions.
  • Unlike a public cloud with shared resources, your data is hosted on servers built exclusively for you such that no other customer of the cloud service will have access to the same infrastructure.
  • Your IT team can apply additional stringent measures to enhance further the security of your cloud network located either on-site or at a third-party private environment.
  • A private cloud offers more security because it is accessed through private, secure networks instead of over the Internet.

2. The total cost of ownership (TCO)

  • TCO is crucial to consider when determining the suitability of IT solutions for your firm, and this is another essential advantage of the private cloud.
  • Studies suggest that hidden costs like bandwidth inflate the TCO of public cloud solutions and that over 40% of IT managers found private clouds to be less expensive.
  • For businesses with high computing demands, the long-term costs of a public cloud can be hefty to nearly ten times that a private solution.

3. Control

  • Private clouds are hosted on-premise or through a private connection to a third-party data center, which enables you to implement changes and upgrades as you see fit for your data and infrastructure.
  • Your IT team can leverage advanced tools to predict and eliminate bottlenecks and reduce the risk of downtime or cyberattacks. You can also quickly adapt your infrastructure to evolve with your business and technology needs.

4. Virtualization

  • An advantage of cloud computing is the application of virtualization technology. Servers at many companies tend to be underutilized, thus making them an unnecessary expense. With virtualization, it is possible to run multiple applications effectively and faster from a single computer as one physical server can be divided into many virtual environments to mimic multiple servers.
business operations

5. Compliance

  • Some industries have specific rules regarding access and storage of business’ and clients’ data. The security, privacy, and control offered by a private cloud will help your business conform to the high standards set by PCI or even your local, state, or federal laws.
  • If you are in the healthcare industry, HIPAA requires that e-PHI (electronically protected health information) is created, transmitted, received, and stored in a way that maintains its confidentiality and integrity. In this scenario, the private cloud is your best option.

6. Customization

  • In IT, a one-size-fits-all approach is not always possible. Depending on your industry, the volume of work, the scale of storage, and size of your firm, computing requirements will differ between companies, so you want a cloud computing solution that caters to your needs.
  • A private cloud allows you to select infrastructure and features for your specific needs to meet organizational goals. A private cloud offers vertical, horizontal, and diagonal scalability for your operations without worrying about extra costs, performance, or security.


To determine if your firm will benefit from a private cloud, you must critically assess your needs in terms of flexibility, computing power, security, and compliance.

A private cloud solution offers all these features, so its benefits tend to be worth the initial implementation cost.

B2B eCommerce Marketing

Topics: B2B eCommerce, ecommerce, cloud

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